Royal Gold, Inc. (RGLD) | Investment Case

1. Company Snapshot

1.a. Company Description

Royal Gold, Inc., together with its subsidiaries, acquires and manages precious metal streams, royalties, and related interests.It focuses on acquiring stream and royalty interests or to finance projects that are in production or in development stage in exchange for stream or royalty interests, which primarily consists of gold, silver, copper, nickel, zinc, lead, and cobalt.As of June 30, 2022, the Company owned interests in 185 properties on five continents, including interests on 41 producing mines and 19 development stage projects.

Its stream and royalty interests on properties are located in the United States, Canada, Chile, the Dominican Republic, Australia, Africa, Mexico, and internationally.Royal Gold, Inc.was incorporated in 1981 and is headquartered in Denver, Colorado.

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1.b. Last Insights on RGLD

Royal Gold's recent performance was driven by its record Q3 revenues of $252 million and stronger year-over-year earnings growth. The company's Q3 stream segment sales volume increased 18% sequentially, driven by stronger metal prices and higher volumes. Royal Gold was upgraded to a Zacks Rank #1 (Strong Buy), reflecting growing optimism about its earnings prospects. The company's strong margins, low-debt capital structure, and solid Q3 financial results, with record revenue and cash flow, are key positives. Brokerages set a target price of $220.44, with seven issuing a buy recommendation.

1.c. Company Highlights

Last Price	201.97
Change Percentage	-0.56%
Open	204.13
Previous Close	203.11
Market Cap ( Millions)	13245
Volume	336417
Year High	209.42
Year Low	130.67
M A 50	190.46
M A 200	175.41

FCF Yield	4.21%
Dividend Yield	0.89%
ROE	14.73%
Debt / Equity	22.61%
Net Debt / EBIDTA	85.02%
Price To Book	3.9
Price Earnings Ratio	27.67
Price To FCF	23.77
Price To sales	15.47
EV / EBITDA	19.7

2. Royal Gold's Q3 2025 Earnings: A Record-Breaking Performance

Royal Gold's third-quarter revenue reached a record $252 million, a 30% increase from the previous year, driven by higher gold, silver, and copper prices. The company's earnings were $127 million, or $1.92 per share, and adjusted earnings were a record $136 million, or $2.06 per share. The strong financial performance was largely due to the 40% rise in gold prices, 34% increase in silver prices, and 6% rise in copper prices compared to the prior year. Royal Gold's portfolio performed well, with revenue from Peñasquito, Cortez CC Zone, LaRonde Zone 5, and Voisey's Bay partially offset by weaker revenue from the Cortez Legacy Zone.

Publication Date: Nov -15

                                    📋 Highlights
                                    Record Revenue Growth::
                                                Q3 2025 revenue hit $252M, up 30% YoY driven by 40% higher gold prices, 34% silver, and 6% copper.
Adjusted Earnings Milestone::
                                                Adjusted earnings reached $136M ($2.06/share), a new high, reflecting strong metal price performance and portfolio optimization.
Strategic Acquisitions::
                                                Completed $1B gold stream deal with First Quantum and acquired Sandstorm Gold/Horizon Copper, expanding royalty assets.
Operational Efficiency::
                                                Cash G&A expenses of $10.2M (under 3% of revenue) and record $174M operating cash flow highlight lean cost structure.
Debt Management Plan::
                                                $1.225B debt deemed manageable with net debt/EBITDA at 1-1.5x; repayment expected by mid-2027 under current metal prices.

                                

Operational Highlights

The company added a strong operator to its portfolio with the $1 billion gold stream transaction with First Quantum. Post-quarter end, Royal Gold completed the acquisition of Sandstorm Gold and Horizon Copper. The Mount Milligan mine life extension project added significant value to Royal Gold's largest asset. The company's operating cash flow was a record $174 million, and cash G&A expense was $10.2 million, with cash G&A as a percentage of revenue less than 3%.

Financial Position and Debt

Royal Gold ended the quarter with $813 million drawn on its revolving credit facility and $188 million of working capital. The company expects to repay its outstanding debt around mid-2027 based on current metal prices and absent further acquisitions. Management expressed comfort with the level of debt, citing a net debt-to-EBITDA ratio of 1-1.5, which is considered comfortable. The effective tax rate for the quarter was 17.9%, and net income increased significantly to $127 million or $1.92 per share.

Valuation and Growth Prospects

Analysts estimate next year's revenue growth at 61.1%. Royal Gold's current P/E Ratio is 25.46, and EV/EBITDA is 18.19, indicating a premium valuation. The company's ROIC is 11.37%, and ROE is 14.73%, suggesting a strong return on investment. With the recent acquisitions, Royal Gold is expected to benefit from increased gold production at Xavantina, which will flow through to their interest. The company aims to have all non-recurring expenses related to the Sandstorm transaction closed by the end of 2025, making 2026 a cleaner year for financial performance.

Outlook and Guidance

Royal Gold plans to provide 2026 guidance at an Investor Day in late March. Management is working to ensure the market understands its business following recent deals, specifically the acquisitions of Sandstorm Gold and Horizon Copper. They plan to spend time with investors and analysts to communicate their growth prospects and valuation story. The company remains active in looking for new opportunities, with a focus on transactions in the $100-300 million range.

3. NewsRoom

Royal Gold, Inc. (RGLD) Presents at Virtual Non-Deal Roadshow Series Transcript

Dec -04

Source: seekingalpha.com

Royal Gold to Participate in the Renmark Financial Communications Virtual Non-Deal Roadshow Series on Tuesday, December 16, 2025

Dec -02

Source: businesswire.com

High Profit Margins Lead To High Dividend Growth: Royal Gold

Dec -01

Source: seekingalpha.com

American Century Companies Inc. Purchases 5,635 Shares of Royal Gold, Inc. $RGLD

Nov -29

Source: defenseworld.net

Royal Gold Presenting at the John Tumazos Very Independent Research 2025 Virtual Conference

Nov -26

Source: businesswire.com

Royal Gold, Inc. (NASDAQ:RGLD) Given Consensus Recommendation of “Moderate Buy” by Analysts

Nov -26

Source: defenseworld.net

Royal Gold: Upgrading To Buy As Gold's Fundamentals Strengthen And Growth Accelerates

Nov -26

Source: seekingalpha.com

Royal Gold to Participate in the Renmark Financial Communications Virtual Non-Deal Roadshow Series on Thursday, December 4, 2025

Nov -21

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (10.62%)

6. Segments

Stream

Expected Growth: 10%

Royal Gold's 10% growth is driven by increasing gold prices, rising production volumes from its streaming agreements, and a strong balance sheet enabling strategic acquisitions. Additionally, the company's diversified portfolio of streams and royalties across various mines and geographies mitigates risks and provides a stable source of revenue.

Royalty

Expected Growth: 12%

Royal Gold's 12% royalty growth is driven by increasing gold prices, rising production volumes from its streaming agreements, and a strong portfolio of assets with low operating costs. Additionally, the company's diversified revenue streams, including copper and silver royalties, contribute to its growth. Furthermore, Royal Gold's disciplined capital allocation and strategic acquisitions also support its growth momentum.

7. Detailed Products

Gold Streams

Royal Gold provides gold streams to mining companies, allowing them to access capital in exchange for a percentage of their gold production.

Royalty Interests

Royal Gold acquires royalty interests in mining projects, providing a percentage of the revenue generated by the project.

Metal Streams

Royal Gold provides metal streams to mining companies, allowing them to access capital in exchange for a percentage of their metal production.

Net Smelter Return (NSR) Royalties

Royal Gold acquires NSR royalties, earning a percentage of the revenue generated by a mining project.

8. Royal Gold, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Royal Gold, Inc. has a diversified portfolio of precious metal streams and royalties, which reduces the threat of substitutes.

Bargaining Power Of Customers

Royal Gold, Inc. has a diverse customer base, but some customers have significant bargaining power due to their large size and purchasing power.

Bargaining Power Of Suppliers

Royal Gold, Inc. has a strong position in the market, which reduces the bargaining power of its suppliers.

Threat Of New Entrants

The gold streaming and royalty business has high barriers to entry, which reduces the threat of new entrants.

Intensity Of Rivalry

The gold streaming and royalty business is competitive, but Royal Gold, Inc. has a strong market position and a diversified portfolio, which reduces the intensity of rivalry.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	7.88%
Debt Cost	7.17%
Equity Weight	92.12%
Equity Cost	7.17%
WACC	7.17%
Leverage	8.55%

11. Quality Control: Royal Gold, Inc. passed 7 out of 9 key points

Strong Liquidity

Low Debt

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

NewMarket

A-Score: 6.7/10

Value: 4.5

Growth: 7.2

Quality: 7.2

Yield: 3.0

Momentum: 9.5

Volatility: 8.7

1-Year Total Return ->

Lundin Gold

A-Score: 6.5/10

Value: 1.9

Growth: 9.1

Quality: 8.6

Yield: 6.0

Momentum: 10.0

Volatility: 3.7

1-Year Total Return ->

Royal Gold

A-Score: 5.7/10

Value: 1.8

Growth: 6.1

Quality: 7.8

Yield: 2.0

Momentum: 9.0

Volatility: 7.3

1-Year Total Return ->

Cabot

A-Score: 5.5/10

Value: 7.1

Growth: 6.4

Quality: 6.0

Yield: 5.0

Momentum: 1.0

Volatility: 7.7

1-Year Total Return ->

Steel Dynamics

A-Score: 4.9/10

Value: 3.4

Growth: 7.1

Quality: 5.1

Yield: 2.0

Momentum: 6.0

Volatility: 6.0

1-Year Total Return ->

CMC

A-Score: 4.4/10

Value: 3.9

Growth: 3.8

Quality: 4.5

Yield: 2.0

Momentum: 6.0

Volatility: 6.3

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

6.20%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

7.17%

Royal Gold, Inc. - US7802871084

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on RGLD

1.c. Company Highlights

Better Quality

Expensive

Less Volatile

Earnings Miss

Revenues Beats

Earnings Beats

Revenues Miss

Strong Momentum

Medium Volatility

2. Royal Gold's Q3 2025 Earnings: A Record-Breaking Performance

Operational Highlights

Financial Position and Debt

Valuation and Growth Prospects

Outlook and Guidance

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (10.62%)

6. Segments

Stream

Expected Growth: 10%

Royalty

Expected Growth: 12%

7. Detailed Products

Gold Streams

Royalty Interests

Metal Streams

Net Smelter Return (NSR) Royalties

8. Royal Gold, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Royal Gold, Inc. passed 7 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

201.97$

Current Price

201.97$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA